A "holier than thou" go it alone approach to global warming would harm British industry, Lord (Kumar) Bhattacharyya, head of the Warwick Manufacturing Group, has warned.

The position of Land Rover as maker of the "best 4x4s" in the world and a major employer and exporter should be taken into account in the debate on taxing so-called gas-guzzlers as part of the campaign to tackle global warning, he told the House of Lords yesterday.

In the debate on the Queen's Speech, Lord Bhattacharyya said he welcomed the Government's proposal to legislate on climate change. But he added: "While we can lead by example, we need to persuade others to go with us. A holier than thou approach will do only damage.

"Since the publication of the Stern Report, there's been a lot of debate about penalising SUVs and 4x4s, whether through taxation or congestion charges.

"When we consider these issues we should remember that Britain produces Land Rover - the best 4x4's in the world. An export success and a major employer.

"We should make sure that we set a level playing field. For example, will our regulation levels match that of other advanced nations?

"If not, the economic consequences will be very negative. Companies should not be forced to produce different models for different markets."

The potentially "catastrophic risk" of climate change could only tackled at a global level, Lord Bhattacharyya said.

"That isn't an argument for inaction but it's clear that the solutions to climate change cannot be found simply in a Bill, or a target, but in international persuasion and compromise," he continued.

"There is a lot of debate about the impact of Chinese and Indian growth on climate change. With high growth rates there is increased energy demand, and so we see increased demand for fossil fuel plants and a surge in hydro-electric power projects.

"We should also be aware that although China and India are both building nuclear power capacity, that option is not available to other countries in South East Asia, all of whom are growing and strongly and will require energy to fuel that growth.

"As it was in the UK in the Sixties, it will be the impact of these developments on the local environment that will lead to regulation of environmental controls."

In a wide-ranging speech, Lord Bhattacharyya referred to claims that high taxes are "strangling" the UK economy.

Criticism of some specific taxes and tax rates were justified, but overseas governments were "unanimously impressed by our achievement of growth without recession", he went on to say.

Lord Bhattacharyya stressed that while Britain was free of the doctrine of economic nationalism, more needed to be done to encourage inward investment.

"Our competitive advantage should involve a fiscal framework to attract and maintain investment.

"Aongside this there should be emphasis on both maintaining an expertise in skills and R&D base and in building mutually beneficial partnerships with companies in development countries.

"In short, we have to be excellent in everything we do."

Lord Bhattacharyya also praised the work of regional development agency Advantage West Midlands. and said RDAs generally should be given more power to prepare their regions for the changing global manufacturing and service markets.

"Britain is a great place to do business. What better proof could there be than the number of bids for British companies and the number of non-UK companies looking to start British operations," he went on to say.